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January 11, 2013
European Sustainable Funds Hold Own in 2012
by Robert Kropp
The twelfth annual study of Green Social and Ethical Funds in Europe by Vigeo Italia notes that
consolidation of the industry has continued for a third year.
It's long been argued that effective regulation is central to the sustainability agenda. The most
recent report on Green Social and Ethical Funds in Europe, published by Vigeo
Italia, bears this out.
France, where the recently enacted Grenelle II
regulations require greenhouse gas (GHG) balance sheets from every company with more than 500
employees, as well as the accounting for environmental, social, and corporate governance (ESG)
factors by fund managers, had the highest rate of growth in assets of all European countries.
France is also by far the largest market for sustainable funds, accounting for 44% of European
assets, followed by the UK and Switzerland.
Furthermore, France experienced the strongest
growth in assets in 2012, followed by the Netherlands and Germany.
Elsewhere, the report
indicates that sustainable funds in Europe have maintained a stage of consolidation for a third
year; the number of funds remained essentially unchanged, and overall assets reached $126 billion
by the end of June, 2012, a 12% growth over a one year period. In 2010, the rate of growth over the
previous year was 41%. The 2012 amount represented 1.6% of the overall retail funds market, a
slight increase over 2011.
Apparently, the financial crisis and the euro debt crisis have
had a significant effect on the investment practices of sustainable investors in Europe. While
equities continue to lead as the investment vehicle of choice, only 49% of assets were devoted to
them; in 2007, fully two-thirds of sustainable assets were in equities. In 2012, fixed income
accounted for 40% of assets, compared to just 20% in 2007,
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